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Presentation on theme: "HEALTH CARE REFORM REVIEW AND UPDATES April 2011."— Presentation transcript:


2 Software Screen

3 Today’s Speaker John Coburn, JD Director of Training & Senior policy attorney for Health & Disability Advocates

4 THEMES OF HEALTHCARE REFORM  “If you got it, we want you to keep it and it may get better.”  “Now, we spend all our time trying to figure out IF those we serve qualify for coverage and how. In the future, for most, it will be a matter of finding out WHICH coverage is appropriate.”  “Everybody has a box.” 4

5 AREAS TO DISCUSS  Overall Structure for Accessing  What Has Been Implemented So Far  Changes to Medicare Part D  Changes to Medicare in General  Medicare Cost Savings  Repeal and Litigation  Implementation to Watch 5

6 SOME THINGS STAY THE SAME  Most will still get coverage through employer insurance plans.  Categories of Medicaid that exist now should remain in place (SSI, pregnant women, children, etc)  Medicare eligibility was not changed……it will still be the source of insurance for Social Security Disability Insurance beneficiaries and older adults.  The rules around what happens to Medicaid or Medicare when a person works will be the same. 6

7 THE NEW STRUCTURE  “Newly Eligible” Medicaid  Insurance Exchange Available to Purchase Coverage (Includes Premium Subsidies and Cost Sharing Credits)  Insurance Exchange with No Subsidies. 7

8 MEDICAID ELIGIBILITY NOW  Some low-income parents and pregnant women can get Medicaid.  Many low income children get health insurance through Medicaid.  Supplemental Security Income (SSI) recipients can get Medicaid.  Social Security Disability Insurance (SSDI) beneficiaries may get Medicaid depending on state rules (spenddown, share of cost, recipient liability etc.).  Special rules/programs allow most working SSDI and SSI beneficiaries to continue with Medicaid coverage.  Low Income seniors can get Medicaid depending on state laws. 8

9 “NEWLY ELIGIBLE” MEDICAID  No need to prove disability or other status.  133% FPL using income “Modified Adjusted Gross Income” MAGI.  No asset limit  Services may look different than other Medicaid categories but must at least cover “essential benefits”.  States required to implement in 2014, but can start earlier if they choose. Unlikely many states will choose this option because there is no enhanced Federal Match until 2014. 9

10 WHO ARE THE “NEWLY ELIGIBLE” MEDICAID?  Individuals waiting for disability determinations.  SSDI beneficiaries during the Medicare waiting period.  Low wage workers with disabilities that are not severe enough to meet the definition or with no disability.  Individuals who are unemployed. 10

11 NEW INSURANCE EXCHANGE 2014  States will establish exchanges for individuals and small businesses (or feds will for them).  Most individuals (exceptions include financial hardship, religious exemptions, etc) must obtain insurance, but insurers can no longer deny or charge more for pre- existing conditions.  Premium credits and cost-sharing subsidies available to those with lower incomes (sliding scale up to 400% FPL).  Uniform benefits packages (must include “essential services” and states can add more) with four levels of value. 11

12 ESSENTIAL HEALTH BENEFITS IN ACA  Outpatient and lab services;  Emergency services;  Hospitalization;  Maternity and newborn care;  Pediatric services, including oral and vision care;  Mental health and substance abuse, including behavior health treatment, with parity to physical health services;  Prescription drugs;  Rehabilitative and habilitative services and devices;  Preventive and wellness services and chronic disease management.  Insurance policies must cover these benefits to be certified and offered in Exchanges, and all Medicaid plans must cover these services by 2014.  Coverage must be equivalent (in actuarial value) to one of four benchmarks: Federal Employee Health Benefits Plan, State Employee Plan, Commercial HMO Product, or Secretary-approved coverage. 12

13 NEW “SEAMLESS” DELIVERY SYSTEM BY 2014 WITH A SINGLE APPLICATION Health Care Coverage Insurance Exchange Expansion Medicaid Regular Medicaid 13

14 THE PREMIUM SUBSIDY  Available up to 400% FPL  Based upon the cost of the second lowest cost silver plan (70% actuarial equivalent)  Assures you pay 3% of income starting at 133% FPL up to 9.5% of income at 300- 400 FPL.  If you want a plan that is more expensive than second lowest cost silver plan, you pay the whole difference. 14

15 THE COST SHARING SUBSIDY  Available up to 250% FPL  Pay less out of pocket by requiring higher percentage paid by plan (actuarial equivalent is higher)  Reduce the maximum out of pocket. 15

16 IMPLEMENTATION SO FAR  High Risk Insurance Pool –check to see if your state has one or if the federal gov’t runs it for your state.  New Requirements for Private Insurance  50% Doughnut Hole Coverage in 2011 16

17 REQUIREMENTS FOR HIGH RISK POOL INSURANCE  Be a U.S. Citizen, National, or Legal Resident  Uninsured for 6 months  Have a pre-existing condition Limited number of slots; first come, first served.  Participation is lower than expected so some programs becoming more generous.  Not relevant to people on Medicare or Medicaid as they are already insured! 17

18 PRIVATE INSURANCE REFORMS NOW THROUGH 2011  Prohibition on pre-existing exclusion for children.  Young adults can stay on parent’s insurance until 26.  Prohibition on lifetime limits and rescissions.  Prohibition on charging co-pays or deductibles for certain preventative and medical screenings on all NEW insurance plans.  Insurers required to reveal details about admin and executive expenditures (Medical Loss Ratio) and on Jan. 1, 2011.  Medical Loss Ration must be 80-85, but many waivers have been granted 18

19 MEDICARE PART D CHANGES  Changing of Annual Enrollment Period  Drug Manufacturer Discount During Doughnut Hole  Discounts to Generics during Doughnut Hole  Closing of Doughnut Hole Over Time  Uniform Exceptions and Appeals Process 19

20 MEDICARE PART D CHANGES  ADAP and Indian Health Services Count as TROOP  Means-tested Part D premiums  Costs eliminated for those participating in Medicaid waivers (similar to nursing home)  Formulary Requirements for 6 Protected Classes and Others  Elimination of part of tax deduction for employer retiree plans 20

21 PHASE OUT OF BRAND DOUGHNUT HOLE  2011-12 50%  2013-2014 52.5%  2015-16 55%  2017 60%  2018 65%  2019 70%  2020 75% 21

22 PHASE OUT OF GENERIC DOUGHNUT HOLE  2011 7%  2012 14%  2013 21%  2014 28%  2015 35%  2016 42%  2017 49%  2018 56%  2019 63%  2020 75% 22

23 OTHER MEDICARE CHANGES  Savings through several mechanisms  Elimination of cost sharing for certain preventive services and free annual check- up.  Freeze Part B means tested income levels at 2010 through 2019 23

24 MEDICARE SAVINGS IN MORE DETAIL  Constraints in payment increases or reductions in payments  Changes to Medicare Advantage  Strategies to increase quality and efficiency  Revenue enhancement through taxes and changes to premium structure for higher income beneficiaries 24

25 CONSTRAINTS IN PAYMENT INCREASES/REDUCTIONS IN PAYMENTS  Cuts in payment increases that vary by type of provider and year  Productivity adjustment based on 10 year average annual increase in economywide productivity  Proponents argue that this will not impact services and this is in line with cuts from previous laws, opponents argue that it will. 25

26 INDEPENDENT PAYMENT ADVISORY BOARD  15 member board appointed by President and confirmed by Senate with 6 year staggered terms (with 3 recs each from Congressional leaders).  Experts in healthcare financing, delivery and organization and majority cannot be involved in delivery or management of services.  Make recommendations for savings if targeted growth rates are not met, with implementation beginning in 2015.  Recommendations go into effect unless Congress enacts, though a fast track process, specific legislation to prevent. 26

27 CHANGES TO MEDICARE ADVANTAGE PAYMENTS  Payments to plan based upon comparison between bid (plan’s cost) and benchmark (max medicare will pay for those benefits).  Benchmarks have been increased in past to encourage participation, which has resulted in benchmarks being higher than average cost of original Medicare.  New law phases in a new way to calculate benchmarks, which will result in both reductions and possible increases for plan quality. 27

28 STRATEGIES TO INCREASE QUALITY AND EFFICIENCY  Medicare prohibited from interfering with practice of medicine or manner in which medical services are provided (medically necessary)  Productivity adjustments (discussed above).  Voluntary program to bundle payments for physician, hospital and post-acute care.  Accountable Care Organizations that meet quality of care targets and reduce costs share in savings.  Payment reform in certain hospital readmission situations and penalty to some hospitals where common, high-cost health conditions acquired in hospital occur  Patient-Centered Outcome Research Institute and CMS Center for Medicare and Medicaid Innovation  Stepped up efforts to prevent fraud 28

29 REVENUE ENHANCEMENT  Increases Medicare Hospital Insurance payroll tax from 1.45 to 2.35 for higher wage earners ($200,000 single, $250,000 couple).  Freezes income point at which Part B premium is means tested at $85,000 single/$170,000 couple through 2019.  Begins means testing for Part D at same income point and that point remains through 2019. 29

30 WAIT: WHERE IS THE DOCTOR’S CUT NOW?  Every year, the physician payment is supposed to decrease and, every year, Congress “kicks the can” to the next year.  Both healthcare reform bills failed to address this issue at all as it was sticking point to moving forward.  But, as usual, the cut was stalled in December 2010, effective through 2011 30

31 WHAT ABOUT REPEAL?  Repeal would require both houses of Congress and President (not gonna happen!)  Most funding is self-executing.  History shows once the ball starts rolling………. 31

32 WHAT ABOUT THESE LAWSUITS?  Score is 3-2 upholding HCR  One judge threw out whole law, other the individual mandate.  Implementation is proceeding.  Likely to land in the Supreme Court for final decision. 32

33 IMPLEMENTATION TO WATCH OUT FOR  High Risk Insurance Pool How is enrollment in your state? Can it be expanded?  States are planning now: Is there stakeholder involvement? What will your exchange look like? What are they doing with planning grants, if applicable? How is your state shoring up eligibility infrastructure?  Essential Benefits Package: What will the requirements be on the federal level What will your state require? 33

34 Questions / Discussion ?

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